The vast majority of the human population earn very little money. With a low regular income, it is difficult to amass significant capital to purchase assets. A number of schemes have been developed to address this problem. For example, there is a system of “lay bys” whereby a person desiring to purchase an asset or a service pays a portion of the price in a number of payments. When the price has been paid off, the buyer is provided with possession of the asset or the service is rendered.
As an alternative, a number of credit facilities have been developed which include micro-finance hire purchase agreements, etc.
These known arrangements suffer from the disadvantage that it may take significant time for the purchaser to “lay by” the purchase price. Financing arrangements suffer from the disadvantage of being costly to implement and administer, and can be difficult to enforce, particularly in a rural environment. The purchaser will end up paying significantly more than the purchase price to cover the administration costs.
A further problem exists, particularly in developing economies, whereby once an asset has been purchased, insufficient planning is made to ensure for the maintenance of that asset. Therefore, assets which might otherwise be easily repaired are neglected to such an extent that repair becomes more expensive.